Fernando Souza

This costs endorsement addresses competing costs claims arising from a motion regarding holdback allocation and distribution in a construction lien reference.

Flocor Inc. sought costs thrown away against the Urban Parties (Urban Integrated Group Inc., Urban Mechanical Contracting Ltd., and Standard Fire Protection Inc.) claiming they misrepresented the contractual relationship between the defendants.

The Urban Parties sought costs against Flocor for unnecessary expense incurred in responding to Flocor's evidence and costs claim.

The court rejected Flocor's claim for costs thrown away, finding that Flocor had ample notice of the correct contractual relationships and that its intended legal position lacked sufficient merit.

The court awarded costs to the Urban Parties for the costs submissions phase only.

The defendant 35 Mercer Limited brought a motion to reduce the construction lien of the plaintiff Urban Electrical Contractors (UEC) by $4,333,708.96.

Prior to the hearing, Mercer, UEC, and Urban Integrated Group Inc. (UIG) settled the motion on terms reducing UEC's lien security by $3,231,464.75.

Subsequently, Mercer and UEC reached a separate settlement to fully discharge UEC's lien and return all security.

However, UIG opposed the full return of security because UIG's own liens had been vacated with reduced security that accounted for UEC's lien security already posted.

The court held that security for one lien cannot be returned without considering other lien claimants affected by that return, and ordered reduction only to the extent of UIG's consent.

The court also declined to award costs, finding the parties had settled the motion without judicial intervention on the merits.

The court-appointed receiver brought a motion seeking a declaration that the debtor had no automatic right of appeal from an Approval and Vesting Order under the Bankruptcy and Insolvency Act, and an order denying leave to appeal.

The debtor argued it had an automatic right of appeal under s. 193(a) or (c) of the BIA, or alternatively sought leave under s. 193(e).

The Court of Appeal held that the debtor had no automatic right of appeal, as the order did not affect future rights or result in a direct loss exceeding $10,000.

The Court also denied leave to appeal, finding the proposed appeal lacked merit, did not raise an issue of general importance, and would unduly hinder the insolvency proceedings.

The applicants, a first mortgagee, sought a declaration that the priority of construction lien claims against unsold condominium units was limited to the statutory holdback amount, and authorization for the receiver to distribute net sale proceeds to the mortgagee.

Two lien claimants opposed, arguing for full priority based on alleged fraudulent conveyance and the nature of the mortgage advance.

The court found that the Construction Act's priority regime is a complete code, and since the lien claims were not preserved or perfected, nor was written notice provided to the mortgagee before the advance, the mortgage had priority over the liens beyond the statutory holdback.

The court also rejected arguments of fraudulent conveyance and the claim that the funds were not a proper "advance in respect of the mortgage." The motion was granted, allowing the receiver to distribute proceeds to the mortgagee while maintaining a holdback reserve for valid lien claims.

This motion, part of a larger reference concerning the Nobu Residences condominium complex, addressed the application of the transition provisions in section 87.3 of the Construction Act.

The core issue was whether the former Construction Lien Act (CLA) or the current Construction Act applied to the improvement and associated liens, which directly impacted lien timeliness.

The owner, 35 Mercer Limited, the contractor, Urban Integrated Group Inc., and a lien claimant, Brunco Insulation Ltd., argued for the application of the CLA, while Desco Plumbing and Heating Supply Inc. contended the current Construction Act should apply.

The court found that the CLA continues to apply to the improvement and all liens arising from it, based on evidence that a procurement process for the improvement commenced before July 1, 2018.

The court rejected arguments that the owner's affidavit was deficient, that ex parte vacating orders were binding, that the onus to provide transition dates was "murky," or that project delays like the COVID-19 pandemic should influence the application of section 87.3.

The moving party, Unity Health, sought summary judgment to dismiss four actions brought by subcontractor plaintiffs, arguing that the plaintiffs' settlement with the surety (Zurich) constituted an inconsistent election that precluded their alternative claims against Unity Health.

Unity Health also sought to dismiss the plaintiffs' unjust enrichment claims and, alternatively, to stay two of the actions for failure to immediately disclose the settlement.

The court dismissed the motions, finding genuine issues for trial regarding the doctrine of inconsistent election and the unjust enrichment claims.

The court also held that the settlement was disclosed in a timely manner once it was finalized, so a stay was not warranted.

This construction lien reference involved a summary trial of an issue concerning the timeliness and bona fide nature of Honeywell Limited's claim for lien against Bondfield Construction Company Limited.

The Lien Vetting Committee, comprising Ozz Electric Inc., Urban Mechanical Contracting Ltd., and Zurich Insurance Company Ltd., argued that Honeywell's lien had expired.

The court found that Honeywell failed to prove its claimed last date of supply, as the evidence provided was deficient and contradictory.

The court also addressed the application of the rule in Browne v. Dunn, concluding it was not engaged because the contradictions were within the witness's own affidavit.

Furthermore, the court commented that even if the last date of supply had been proven, the supply after receiving notice of Bondfield's financial issues would not have been bona fide.

Consequently, Honeywell's lien was ruled to have expired and was ordered vacated.

The appellants, a group of subcontractors and a bank, appealed an application judge's decision that rescission of surety bonds might be possible even if it affects innocent third parties.

The bonds were issued by Zurich Insurance Company Ltd. for a large construction project, but Zurich later discovered alleged fraudulent misrepresentations and collusion that induced it to issue the bonds.

The appellants sought a declaration that rescission was unavailable as a matter of law due to the involvement of innocent third parties.

The Court of Appeal dismissed the appeal, affirming that prejudice to third parties is not an absolute bar to rescission, especially in cases of fraudulent misrepresentation, and that such a determination requires a full factual record at trial.

The defendants brought a motion to stay the plaintiffs' oppression and breach of fiduciary duty action in favour of arbitration under s. 7 of the Arbitration Act, 1991.

The parties, who are siblings, had previously settled an arbitration but reserved rights regarding the sale of certain properties.

The court applied the Haas framework and found there was an arguable basis that the arbitral panel had jurisdiction over the dispute.

The action was stayed pending the outcome of the arbitration, with costs awarded to the defendants.

Zurich, the surety for the insolvent general contractor Bondfield, brought a motion to intervene as a party in a construction lien reference.

Zurich sought to participate in a vetting committee for the distribution of the owner's holdback among the timely lien claimants.

The court granted the motion, finding that Zurich had a direct interest in the holdback because it had made significant holdback advances to the major electrical and mechanical trades and had taken partial assignments of their lien rights.

The court ordered the timely claimants to pay Zurich's costs of $30,000.

The defendant, Broccolini Construction (Toronto) Inc., brought a motion to strike various paragraphs of the Fresh as Amended Statement of Claim filed by Urban Mechanical Contracting Ltd. The motion was based on the argument that the impugned paragraphs constituted an abuse of process by attempting to relitigate issues previously determined by Sossin J. The court reviewed Sossin J.'s prior decision, which had limited Urban's claims to those within a specific "Delay Claim" carved out of a settlement agreement, excluding tort and unjust enrichment claims against Broccolini.

The motion to strike was partially granted, with specific references to negligence and unjust enrichment claims being struck without leave to amend, as they were found to be an abuse of process.

This is a costs endorsement following motions to compel discovery answers.

The Plaintiff, Vanalt Electrical Construction, Inc. (VEC), sought costs for its motion, while the Defendants, Ozz Electric Inc. et al., sought costs or reservation.

The court awarded VEC $5,000 in partial indemnity costs, finding that the Defendants' conduct unnecessarily prolonged the discovery process and increased litigation expenses.

Costs related to 33 adjourned questions were reserved for future determination.

The plaintiff's action against the defendants was dismissed.

This endorsement addresses the costs payable by the plaintiff, Ms. Liddy, to the defendant, Ms. Mauro.

Ms. Mauro sought substantial indemnity costs of over $650,000, or partial indemnity then substantial indemnity costs of over $613,000, based on Ms. Liddy's unreasonable conduct, rejection of settlement offers, and pursuit of unsubstantiated allegations, including punitive damages.

Ms. Liddy argued for partial indemnity costs at no more than 50% of Ms. Mauro's fees, blaming the City of Vaughan defendants for delays and a mistrial.

The court found Ms. Mauro's offers reasonable and Ms. Liddy's conduct, particularly the persistent punitive damages claim without evidentiary support, reprehensible.

The court awarded Ms. Mauro $585,000 in costs, inclusive of disbursements and taxes, assessed on a partial indemnity scale until the start of trial and on a substantial indemnity basis thereafter.

The plaintiff brought an action in negligence, nuisance, and trespass against her neighbours and the City of Vaughan, alleging that construction activities on the neighbours' property altered the grading and caused water to flow onto her property, resulting in damages.

The claims against the municipal defendants were settled during trial.

The court dismissed the remaining claims against the neighbour, finding that the plaintiff failed to prove causation.

Expert evidence established that the water problems were actually caused by the plaintiff's own landscapers, who had flattened the common swale and altered the grading on her property, preventing proper drainage.

The court found no negligence or unreasonable interference by the neighbour.

The defendants brought a motion under Rules 21 and 25 to strike portions of the plaintiff's statement of claim in a construction dispute.

The parties had previously executed minutes of settlement that released all claims except for a specific delay claim.

The court found that the plaintiff's claims extending beyond the delay claim were barred by the settlement release and struck them as an abuse of process.

The court also limited documentary discovery primarily to the period after the performance date.

The Bondfield Group, a major construction company, sought CCAA protection due to insolvency, over $1 billion in active contracts, and over 200 lawsuits.

The application was unopposed and resulted from extensive stakeholder negotiations.

The court granted an initial order for CCAA protection, including a stay of proceedings, approval of a tailored $8 million Debtor-in-Possession (DIP) facility funded by Zurich Insurance, an Administration Charge for professional fees, and a Directors' Charge for $3 million (excluding John Aquino).

The court emphasized the public interest in completing critical infrastructure projects and the preference for CCAA over receivership to preserve enterprise value.

The appellants purchased an HVAC system installed by the respondent in 2006.

The system malfunctioned almost immediately.

The respondent assured the appellants that problems were due to improper maintenance and sold them a maintenance contract.

After two years of unsuccessful maintenance, the appellants concluded the respondent had been lying.

By fall 2009, they consulted other HVAC providers.

In November 2010, the manufacturer informed them the system was improperly installed.

The appellants commenced an action in February 2012.

The respondent moved for summary judgment arguing the action was statute-barred under the two-year limitation period in the Limitations Act, 2002.

The motion judge granted the motion, finding the appellants discovered their claim well before February 2010.

The appellants appealed, arguing they did not discover their claim until November 2010 when they learned the reason for the system's failure.

The majority of the Court of Appeal dismissed the appeal, holding that the appellants did not need to know the precise cause of the malfunction to discover their claim—only that the system was not working and the respondent was responsible for its installation.

The dissent argued that knowledge of the improper installation was essential to discovering the claim and that the respondent's fraudulent concealment should have tolled the limitation period.

The plaintiff brought a motion for summary judgment seeking payment of over $5.1 million in outstanding invoices for bitumen supplied to the defendant.

The defendant argued the claim was partially statute-barred and that the parties had entered into a new agreement allowing the defendant to withhold payment to set off costs from alleged roadway deficiencies caused by the plaintiff's product.

The court found the claim was not statute-barred, as the limitation period began 30 days after the statement was delivered.

However, the court found a genuine issue requiring a trial regarding the existence of the new agreement and ordered a mini-trial on that issue.

The defendant developer moved to discharge a construction lien registered by the plaintiff contractor, arguing the lien was registered out of time because the parties had entered into five separate contracts rather than one global contract.

The plaintiff cross-moved for summary judgment, asserting there was only one contract for the entire subdivision project.

Applying principles of contract interpretation, the court found the explicit provisions of the contractual materials clearly established five separate agreements.

Consequently, the plaintiff's lien was registered out of time and was invalid, particularly as it was registered against premises where no work or materials were supplied.

The defendant's motion to discharge the lien and release funds paid into court was granted.

The plaintiffs retained the defendant to install an HVAC system in their new home.

The system experienced significant problems immediately after installation in 2006.

Despite maintenance attempts, the problems persisted, and by late 2009, the plaintiffs were consulting other service providers who advised the system was improperly installed.

The plaintiffs commenced an action for damages in February 2012.

The defendant brought a motion for summary judgment to dismiss the action as statute-barred.

The court granted the motion, finding the plaintiffs discovered their claim well before February 2010, as they knew the system was defective and were no longer relying on the defendant's good faith efforts to remedy the issues.